Short Definition
Raising rent value by the landlord, typically done at contract renewal, subject to legal restrictions preventing excessive increases and protecting tenants.
Calculate it: Lease Dates CalculatorOverview
Legal Basis
Rent increase is based on contractual freedom in the Civil Transactions Law issued by Royal Decree No. (M/191) of 1444 AH. It is limited by the rules regulating the lessor–lessee relationship issued by Royal Decree No. (M/73) dated 2/4/1447 AH, which prohibit any increase in total rent in the city of Riyadh for 5 years from 25 September 2025, with a fine of up to 12 months’ rent plus correction of the violation. Outside Riyadh there is no statutory cap, and a rent-adjustment request is filed on Ejar at least 90 days before the lease ends. Any increase must be documented on Ejar, either as a contract amendment or on renewal.
Practical Example
A villa lease in Jeddah at SAR 60,000 annually, ending in Ramadan. Market prices rose 8% during the year. Ninety days before expiry, the lessor submits a rent-adjustment request via Ejar proposing renewal at SAR 65,000 (8.3% increase). The lessee compares with similar apartments in the area, finds them at same prices, and accepts the increase. The contract is digitally renewed at new value. Alternatively, had the lessor demanded SAR 80,000 (33% increase), the lessee refuses, the contract ends, and the owner searches for a new tenant at market price. Excessive increase costs the owner vacancy period.
Common Mistakes
- ✗Raising rent mid-contract without explicit lessee consent — clear contract breach, the increase is invalid even if justified by market prices.
- ✗Sending increase notice a few days before contract end — doesn't respect notice period and the lessor may lose right to increase for that year.
- ✗Proposing a large increase without real market justification — drives the lessee to leave and incurs vacancy period possibly exceeding the increase.
- ✗Assuming verbally agreed increase is effective — not binding until documented in Ejar.
- ✗Failing to calculate increase impact on VAT (for commercial contracts) — may create unaccounted additional tax obligations.
International Differences
In Dubai, rent increases are regulated by Decree No. 43 of 2013 using the Dubai Land Department rental index, which sets caps based on the price gap with the market; Ejari is the lease registration system. In Turkey, annual increase is capped to inflation index (TÜFE) and cannot legally exceed it. In Egypt, Law No. 164 of 2025 raised old-rent contracts and set an end date for them (7 years residential, 5 non-residential); new ones are open. In Saudi Arabia: contractual freedom outside Riyadh, while annual increases on residential and commercial rents in Riyadh are frozen for 5 years from 25 September 2025.

